Euro area public debt will rise, in the wake of the pandemic-induced recession, although it is unlikely to make debt levels unsustainable, the European Central Bank chief economist Philip Lane said in an interview with Portuguese broadcaster RTP early Tuesday.
Additional quotes
“Yes, there will be more public debt, but in the context of very low-interest rates, in the context of the macroeconomic environment, the assessment should be that this is something that is sustainable.
“There is no reason to believe that this has some kind of intrinsic dynamic that will lead us to a return of the conditions of ten years ago.”
“The cost of making the payments on this debt in the years to come will be quite contained.”
Market reaction
EUR/USD was last seen trading at 1.1861, up 0.08% on daily basis, mainly driven by the risk-on mood led broad-based US dollar weakness. The EUR markets ignored the above comments.
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